Davao-GenSan-Bitung shipping route to strengthen trade relations among PHL and Indonesia

By , on April 28, 2017


The opening of a new maritime route within the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA) is expected to strengthen economic ties between the Philippines and Indonesia. (PNA photo)
The opening of a new maritime route within the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA) is expected to strengthen economic ties between the Philippines and Indonesia. (PNA photo)

MANILA—The opening of a new maritime route within the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA) is expected to strengthen economic ties between the Philippines and Indonesia.

A roll-on roll-off (RORO) ferry service traversing the Davao City-General Santos-Bitung, Indonesia route to be launched Sunday (April 30) will provide a cheaper and faster avenue for trading goods among EAGA’s key cities.

“Sea linkage within the EAGA subregion is crucial in strengthening trade relations among its member countries since it supports the achievement of the goals of the other EAGA pillars such as agribusiness, tourism, and sociocultural and education,” said Secretary Datu Abul Khayr Alonto, chairman of the Mindanao Development Authority (MinDA) in a statement.

Alonto, who is also the Philippine signing minister for BIMP-EAGA, further stated that maritime transportation contributes to the subregion’s development and the Philippines will continue to push for the opening of sea routes within.

He is encouraging industry leaders and traders to support the initiative and utilize the various opportunities and benefits that the new route will provide.

The MinDA chairperson also reiterated that public support is important to the success of the project which is the Philippine government’s maiden accomplishment under its chairmanship of the ASEAN this year.

The new maritime route is expected to become a more cost and time-efficient alternative to the Manila-Jakarta-Bitung route, which usually takes about three to five weeks of shipping time.

In contrast, direct shipping through the Davao-GenSan-Bitung route will take only one and a half day of sailing (excluding port stay).

M/V Super Shuttle RoRo 12, operated by the Asian Marine Transport Corporation, will provide a weekly shipping service to the route with a vessel capacity of 500 Twenty Foot Equivalent Units (TEUs).

Savings of up to USD1,500 (PHP74,000) per TEU is expected to be generated through this route given its USD700 (PHP34,713) per TEU rate per 20 feet dry container as compared to the Davao-General Santos to Manila to Manado via Jakarta which amounts to USD2,200 (PHP109,098) per TEU.

Furthermore, the opening of the route will provide greater opportunities for local businessmen to participate in international trade as well as stimulate other areas of development such as joint tourism promotion, establishment of direct linkages, and increase in investments, among others.

Among the goods identified by the private sector in Mindanao at this stage that will be shipped to Indonesia are: animal feeds, fertilizer, construction materials, ice cream products, poultry (halal), fresh fruits, and synthetics.

Initial list of import goods, on the other hand, include matured coconut, copra, corn, feed ingredients, lumber, cement, high value crops, vegetables, meat, peanuts, aqua products, charcoal, soya, coffee beans, and sugar.

For his part, Department of Trade and Industry (DTI) Assistant Secretary Arturo Boncato Jr. said the RORO service is one of the priority projects of the BIMP-EAGA’s connectivity group.

He explained that with the completed port improvements and the declaration of the city of Bitung as an international port, the sustainability of the route becomes more feasible as the Indonesian government has provided its full support to the link’s opening and operation.

Boncato, a senior official of the BIMP-EAGA, stated that the route would help boost the competitiveness of Mindanao products and provide a more efficient access for local businessmen to engage trading with Indonesian partners.

President Rodrigo Duterte and Indonesian President Joko Widodo are expected to attend the launch of the shipping route.

In a feasibility study conducted by the Japan International Cooperation in 2012, the Gensan-Bitung route was selected as one of the pilot areas for a roll-on roll-off operation within BIMP-EAGA.

The study also highlighted that the route can be dedicated to a freight service once shipping service requirements are in place.

A study conducted by the Research Education and Institutional Development Foundation through the US Agency for International Development in 2010 revealed that the North Sulawesi-Mindanao sea link offers strong potentials for international trade and commerce between Indonesia and the Philippines since it offers a proximate channel for the shipment of goods.